NEW DELHI: There is no scope for new entrants as the Indian telecom market is adequate for three players now, said Cellular Operators Association of India (COAI) director general SP Kochhar. Kochar in an interview with TNIE said that Indian telecom has reached its consolidation stage and thus there is no space for other operators.
“Any industry initially begins with one or two players, then it starts expanding and multiple numbers of players come in it. After sometime consolidation starts, and then at the end, we have two or three big players or serious players. We have reached this consolidation stage right now,” said Kochhar.
Till last decade the Indian telecom industry was flooded with operators including Airtel, Tata Teleservices, Aircel, Videocon, Reliance Communications, Vodafone, Idea and state-owned BSNL and MTNL.
Among them only Airtel, Vodafone and Idea could survive for sometime.
However, the entry of Reliance Jio in 2016 disrupted the entire telecom market and started a price war. Reliance Jio compelled its rivals to follow similar strategies-- to keep lower tariffs to stay relevant. Subsequently, both Airtel and Vodafone have seen their profits and market shares dwindle.
The lower tariff and government taxes led the industry into loss, piled up their debts.
“Telecom is not a lucrative field as it is a highly capital intensive industry. Then there are different types of taxes and tariffs on it. I don’t think there is too much scope for others to come. There are no chances of exiting any one from it right now. I think the market will continue with the current set of three players. It is good enough for the Indian market,” said Kochhar.
As per telecom regulatory data, Airtel has market shares to 30.35% while Vi has 23.07% and Jio has 36.58% in October.
And the recent government aid package and tariff hike by the telecom operators improved their situation.